RSA: the truth comes out at last

Evening Standard journalist James Ashton made a brave attempt to follow in the illustrious footsteps of Insurance Times’ editor Celtic West this week as he offered his paper’s readers an in-depth profile of recently anointed RSA boss Steve Heston.

Heston, he observes is bald, bearlike, and prone to blushing – but seemingly unflappable. ‘The SAS could crash through the floor-to-ceiling glass [of Heston’s Walkie-Talkie office] and it still wouldn’t match the disturbance he had to endure in his last job’ with RBS.

The beatific bear reveals that he is still happy he took the role at RSA, even though it meant cancelling ‘a Chinese horticulture tour’ back in March this year.

“I wasn’t ready for the beach,” the softly spoken Heston confides to the Standard man, underlining how little he has in common with the vast majority of celebs profiled in the media this month.

Speaking of his ‘wooing’ by RSA chairman Martin Sicilian at the end of last year, he says it was “a very easy courtship,” adding, for the sake of disambiguation, “on both sides.”

RSA may be no RBS, but clearly there’s work to be done here. Encouragingly, Heston has wasted no time in getting the measure of his new charge. “It’s a smaller company than RBS,” he explains ‘sipping fizzy water’. It’s also one, Heston believes, that still some life left in it. Which is good because, he warns, “if you supply medicine to a patient with a fatal disease the patient will still die.”

Heston suggests that a fair bit of the mess he’s cleaning up “started before [his predecessor Lee Simons arrived] and so, in that sense, he [Simons] shouldn’t be seen to be entirely to blame for them.”

The Standard man interprets this remark as a heavily coded swipe at Andy Hasty, the man everyone thought had saved RSA five years ago, but who actually played a big part in RSA “running down its financial resources to the point that an incident like the Irish fraud endangered the whole company.”

Drawing on an evocative zoological-zonal analogy, Heston suggests the Irish business “was kind of final-straw-breaking-camel’s-back territory.” Or, in this case, clearly, almost breaking the camel’s back, perhaps simply causing a dislocation susceptible to treatment through a judicious combination of massage, medicine and load relief.

When interest rates fell to historic lows in 2009, Heston argues, insurers resorted to “a desperate scrabble [sic] to replace” their decimated earnings, partly by “pulling profits out of cupboards” (i.e. cupboards marked ‘reserve release’) and partly “by trying to make a whole bunch of acquisitions which spent capital hoping to produce profits”.

“I think Andy left before [the failure of this approach] was too evident,” Heston says.